According to Odaily, New York City Comptroller Brad Lander has communicated to Tesla's board and CEO Elon Musk that Tesla, as a public company, should not operate like a family business run by Musk. Lander, who oversees five public pension funds with a total asset management scale of $242 billion, stated that a truly independent board's CEO would not be someone who also serves as the CEO of two other large companies. He and an alliance of seven other investors urged Tesla shareholders to vote against Musk's $47 billion stock option plan at the shareholders' meeting on June 13. The compensation plan was initially valued at $55.8 billion but fluctuates with the company's stock performance.
Investors submitted a notice this week outlining a series of concerns about corporate governance and what Lander referred to as Musk's 'astronomical' compensation. One reason, Lander said, is that Musk is not working full-time at Tesla. He added that Musk's attention is undoubtedly distracted by his other companies, including SpaceX, The Boring Company, xAI, X, and Neuralink. In Lander's view, Tesla's practices could influence other companies and founders who prefer to maintain close control of their companies while entering the capital market. 'This is not the shareholder governance envisioned by shareholder capitalism,' he said.
Lander added that Americans are fortunate to have had prosperous capital markets for generations, thanks to the independent governance model. Under this model, shareholders can invest and trust that board members will act as their independent representatives in the company's management team. However, he warned that this is not the case with Tesla: 'There are few cases of such excessive flaunting of independent shareholder governance.' Lander said that although he and other investors did not lobby to replace Musk, the Tesla CEO 'absolutely' could be replaced. However, he would prefer the board to negotiate a 'suitable compensation plan' with Musk and hopes that Musk can provide the attention and focus required for his job at Tesla.
